Real Estate Trends – Newton, Massachusetts (Multifamily)

Introduction:

Welcome back again for our latest real estate market trend report. For those of you that are here for the first time what we do in these reports is examine the real estate market in a city or town in Massachusetts or New Hampshire to evaluate the current conditions. We do this by looking at the changes in three key metrics year over year for the municipality to see how the market has changed and then evaluate what those observations might mean for that market moving forward.

It has been a while since we last looked at a Multifamily market (Not since we did Lowell and Brockton in back to back posts in February) so we are going to look at that niche. It is much smaller than the single family and Condo markets in most places so most towns do not have enough data to even do a report. However it is good to take a look at the places that do have a viable multifamily market so we will try to highlight those a little more regularly.

Near the end of last month we highlighted the Condo Market in Newton and saw it was down a little bit. Let’s see if the trends are similar or not for Multifamily properties.

Market Trends in Newton, MA – July 2014 and 2015:

The Newton, MA Multifamily market appears to be down a good amount since last year. Both the average listing and average sales prices were down quite a bit. The days on market though look to be down substantially since last year at first glance, this does seem well overstated with a deeper look though. Inventory was fairly consistent going from 8 sales in July of 2014 to 9 in July 2015.

Average Listing Prices:

To start off first we are going to look at the average listing price. For Newton, MA multifamilies the average listing price in July 2014 was $932,000. This was down to $770,756 in July 2015. This gives a huge 17.30% decrease year over year.

With that big of a change we definitely want to look at the median prices for multifamilies in Newton, MA as well. Looking at those numbers we see it is a bit different in 2014 but pretty close in 2015. For July of 2014 the median listing price for a Newton, MA multifamily was $949,499 and in July 2015 it was $679,000 which actually gives a much larger 28.49% decrease.

Average Sale Prices:

Next up we will be looking at is the average sale prices. The average sale price for Newton, MA multifamilies in July of 2014 was $902,375 and in July 2015 that was down to $786,894. That gives a noticeably smaller, but still very large, decrease of 12.80%.

Looking at the median prices we see that they are a smaller than the average prices, but are both a lot closer than the listing price were. For July of 2014 the median sales price for a Newton, MA multifamily was $890,000 and in July 2015 it was $768,000 giving a slightly larger 13.71% decrease compared to the averages. While the decrease was also higher here for the median prices, like the listing prices were, the difference was fairly small and just supported a similar level of decrease.

Both methods show that prices are down significantly for Newton, MA multifamilies from last year.

Average Days on Market:

Finally the last metric we look at are the average days on market, which is the measure of how long it takes for a house to sell in the current market. For multifamily properties in Newton, MA the average days on market in July of 2014 were 64.0 and the average days on market for July 2015 were 20.33, for a very significant 68.23% decrease.

In 2014 there was a house with 320 days on market; this was higher the other 7 properties combined with 62.5% of the total days on market for all 8 houses. When removed the new calculation for the remaining 7 properties gives an average days on market of 27.43.

Using the adjusted numbers we see that there is a much smaller 25.88% decrease. So the general did not change from thinking things were down since last year. However the perception went from being down a very large amount to now being a much more modest decrease.

Newton, Mass Summary:

The Newton, Massachusetts multifamily real estate market looks like is has declined quite a bit since last year. The significant drops in listing prices and sale prices, by both averages and medians, show things are down. However, the decrease in days on market is a slight counter argument. While days on market are important to track they are far less important overall than the prices when looking at a market. In addition to that it is worth noting that they were fairly low in both years so while the decrease is still noticeable it just made a good situation a bit better.

In summary if you are looking to sell a multifamily house in Newton, MA now you should expect to get significantly less for it than you would have expected to get last year. In addition you should also expect it to take a little less time to sell compared to last year.

Comments

Thanks for reading and commenting.
To this point we have somewhat arbitrarily restricted the areas we have written about the towns in the 6 Eastern Counties off Cape since we will work in pretty much all of those.

However we do look at places in and around Worcester pretty regularly so we are going to reevaluate that choice and maybe start cherry picking some other places we like outside of that “core” area. If so Worcester Multifamily properties would be right near the top of the list.